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on Cognitive and Behavioural Economics |
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Issue of 2025–03–03
four papers chosen by Marco Novarese, Università degli Studi del Piemonte Orientale |
| By: | Luca Delle Foglie (DEF, University of Rome "Tor Vergata"); Stefano Papa (DEF, University of Rome "Tor Vergata"); Giancarlo Spagnolo (CEIS & DEF, University of Rome "Tor Vergata") |
| Abstract: | We examine how betrayal aversion and ambiguity attitudes influence trust. To disentangle these effects, we use a Trust game and manipulate trustors’ perception of being the intentional recipients of trustees’ betrayal by varying the nature of the latter: a human or a machine that replicates human choices in probability. After confirming that this manipulation does not affect ambiguity attitudes or beliefs about others’ behavior, we find that both factors significantly influence trust. Nonetheless, even when controlling for these attitudes and beliefs, participants exhibit lower trust in humans than in machine. Furthermore, using Noldus’ FaceReader technology to measure emotions during trustors’ decision-making process, we find that participants express greater anger toward human trustees. Our results indicate that both betrayal aversion and ambiguity attitudes play important roles in shaping trust decisions. |
| Keywords: | Ambiguity attitudes, Anger, Betrayal cost, Emotions, FaceReader, Trust game |
| JEL: | A13 C91 D03 D64 D90 |
| Date: | 2025–02–21 |
| URL: | https://d.repec.org/n?u=RePEc:rtv:ceisrp:593 |
| By: | Andrew Caplin; Daniel Martin; Philip Marx; Anastasiia Morozova; Leshan Xu |
| Abstract: | We introduce the first general test of capacity-constrained learning models. Cognitive economic models of this type share the common feature that constraints on perception are exogenously fixed, as in the widely used fixed-capacity versions of rational inattention (Sims 2003) and efficient coding (Woodford 2012). We show that choice data are consistent with capacity-constrained learning if and only if they satisfy a No Improving (Action or Attention) Switches (NIS) condition. Based on existing experiments in which the incentives for being correct are varied, we find strong evidence that participants fail NIS for a wide range of standard perceptual tasks: identifying the proportion of ball colors, recognizing shapes, and counting the number of balls. However, we find that this is not true for all existing perceptual tasks in the literature, which offers insights into settings where we do or do not expect incentives to impact the extent of attention. |
| Date: | 2025–01 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2502.00195 |
| By: | Patrick Premand; Thomas Bossuroy; Sambo, Soumaila Abdoulaye; Markus, Hazel; Walton, Gregory; Thomas, Catherine |
| Abstract: | Poverty is multidimensional, associated not only with a lack of financial resources, but also often social-psychological constraints, such as diminished agency and aspirations. Through a series of field experiments, this paper assesses the causal impacts of culturally wise interventions designed to build women’s agency on poverty reduction efforts in rural Niger. Moreover, the study identifies a model of agency that is “culturally wise” because it is the most motivational and functional in the study cultural context. Study 1 reports descriptive evidence that an interdependent model of agency—that is grounded in social harmony, respect, and collective advancement and that accounts for relational affordances for individual goals—is predominant in rural Niger. This stands in contrast to a more self-oriented, independent model grounded in personal aspirations, self-direction, and self-advancement that is more common in the West. Study 2 explores the psychosocial mechanisms of a highly effective, multifaceted poverty reduction program that included two psychosocial interventions—a community sensitization and a life skills training, which incorporated both models of agency. Although the results support the role of intrapersonal processes (including enhanced self-efficacy and optimistic future expectations) in driving economic impacts, there is equal, if not greater, support for relational processes (including increased subjective social standing, control over earnings, and social support). Study 3 conducts a mechanism experiment to disentangle the causal effects of interventions grounded in independent agency (“personal initiative”) or interdependent agency (“interpersonal initiative”). The results show that the interdependent agency intervention, which is considered to be most “culturally wise, ” led to significant effects on economic outcomes as well as both intrapersonal and relational processes. By contrast, the independent agency intervention showed impacts on intrapersonal processes alone. These findings show the promise of an emerging area of research at the intersection of behavioral science, cultural psychology, and development economics for addressing complex global problems like poverty and inequality. |
| Date: | 2024–06–26 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wbrwps:10824 |
| By: | Ilke Aydogan (IESEG School of Management, Univ. Lille, CNRS, UMR 9221 - LEM - Lille Economie´ Management, F-59000 Lille, France; and iRisk Research Center on Risk and Uncertainty); Loïc Berger (CNRS, Univ. Lille, IESEG School of Management, UMR 9221 - LEM - Lille Economie´ Management, F-59000 Lille, France; iRisk Research Center on Risk and Uncertainty; RFF-CMCC European Institute on Economics and the Environment (EIEE), and Centro Euro-Mediterraneo sui Cambiamenti Climatici, Italy); Vincent Theroude (Université de Lorraine, Université de Strasbourg, CNRS, BETA, 54000, Nancy, France) |
| Abstract: | We investigate the validity of a double random incentive system where only a subset of subjects is paid for one of their choices. By focusing on individual decisionmaking under risk and ambiguity, we show that using either a standard random incentive system, where all subjects are paid, or a double random system, where only 10% of subjects are paid, yields similar preference elicitation results. These findings suggest that adopting a double random incentive system could significantly reduce experimental costs and logistic e orts, thereby facilitating the exploration of individual decision-making in larger-scale and higher-stakes experiments. |
| Keywords: | Experimental methodology, Payment methods, Incentives, Ambiguity elicitation |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:ies:wpaper:e202417 |